Tower's half year profit has jumped by more than 80%, as it recovers from the costs associated with the Canterbury earthquakes and improves revenue growth.
The listed insurer and fund manager reported a profit of $23.6 million in the six months to the end of March, 82% higher than in the same period a year earlier, when it made $13 million.
Revenue rose 14% to $296 million.
Tower's life insurance arm doubled its profit in the period, while its general and health insurance divisions reported smaller gains.
Tower managing director Rob Flannagan says the group's recovering well from last year's earthquakes, but economic conditions remain challenging.
He says the company is aware that discretionary spending is limited and people are shopping around in the general insurance market to get the best price.
"Our concern is that a lot of people don't really understand what they're covered for in their insurance, so cheap doesn't necessarily mean it's ... good protection".
Mr Flannagan says the company's challenge is to ensure that policy holders do really understand the cover that they have.
Reinsurance costs expected to climb
Tower expects reinsurance costs to climb again this year, but doesn't yet know whether premiums will rise because of it.
Mr Flannagan says higher reinsurance costs and EQC levies have meant insurance premiums, across the industry, have risen about 50% in the last year.
He expects reinsurance costs to climb again this year, but probably not by as much as they did last year.
Mr Flannagan says it takes a long time to determine the disaster's real cost and assessments have been made after last year's events and reinsurers adjusted, and there's likely to be a further adjustment this year.
He says the size of any reinsurance increase this year is not yet known which means it's impossible to say whether it will lead to any policy premium increases.